(REUTERS) -- Newcrest Mining, the world's No.3 gold miner, on Tuesday cut its production forecast for this year, saying its major projects had struggled to reach output targets.
Newcrest said its Cadia East development in Australia had been impaired by heavy rains, while long-term under-investment in equipment maintenance at a gold processing plant at its Lihir mine in Papua New Guinea led to production disruptions.
Newcrest cut its fiscal 2012 production guidance to 2.25-2.35 million ounces of gold from earlier, already lowered, guidance of 2.43-2.55 million ounces.
For the March quarter, Newcrest reported an 8 percent drop in production to 532,237 ounces of gold against the previous quarter but said cash margins remained robust at $A978 an ounce against costs of A$609 an ounce.
In February, Newcrest beat market forecasts with a 17 percent jump in half-year underlying profit, buoyed by soaring gold prices, and rewarded shareholders with a healthy dividend increase.
The Lihir mine's monthly rate of production was not yet reaching the 65,000 to 75,000 ounces per month anticipated in February, when Newcrest last revised its guidance, the company said.
We now expect production to continue at around 50,000 to 60,000 ounces per month for the remainder of the financial year, it said.
Also, its Cadia Valley mine continued to experience extremely high rainfall during the quarter which hampered production from a richer-grade open pit deposit, Newcrest said.
Newcrest issued a wide production guidance for fiscal 2013 -- 700,000-900,00 ounces for Lihir and 400,000-500,000 ounces for Cadia Valley -- which starts July 1, 2012 as it finalises its budget for next year.
Telfer, another large Australian mine owned by Newcrest, yielded 135,684 ounces of gold at a cash cost of A$660 per ounce and 7,949 tonnes of copper.
This compares with the December 2011 quarter yield of 135,427 ounces of gold produced at an average cash cost of A$800 per ounce, and 7,440 tonnes of copper.